The Union Budget is usually said to dig one hole to fill another. However, this one is surprisingly different, says Vijay Kedia, MD, Kedia Securities.

In an exclusive interaction with ETMarkets.com, he said the salaried class is 100 per cent honest taxpayers, as they have no way to escape or hide income like any other classes.

Commenting on the tax exemption for the middle class, Kedia said people initially got confused that the basic exemption limit for individual taxpayers has been raised from Rs 2.50 lakh to Rs 5 lakh, but that is not the case.

They have just amended Section 87A and stated that if the net taxable income is up to Rs 5 lakhs after all deductions, only then no tax will be charged. “Else, last year’s rules will apply,” he said.

Apart from the income-tax rebate and Rs 6,000 per annum basic income support to small farmers, the Budget also set a target to have 1 lakh ‘digital villages’.

Kedia says the direct income support for farmers is too little, but it is still better than nothing. “It should be seen along with the other benefits being announced. As it is, more such benefits will be clubbed in election manifestos by all the political parties close to the election,” Kedia said.

Kedia does not think the Budget will be a game changer for the incumbent government. “I don't think it will help the present government get healthy votes in the forthcoming elections,” he said.

From the capital market’s point of view, Kedia says the market’s focus will now shift on the general elections.

He says the euphoria of 2017 is over and the worst of late 2018 has also ended. “The market is offering a golden opportunity to long-term investors to accumulate quality shares at reasonable valuations. But it is not an all-that-glitters-are-gold kind of market. Investors should be very selective and patient,” he said.

The indices have been holding fort in spite of so many unfavourable news as well as sustained selling by foreign institutional investors. “I don’t mind speculating that index may hit a new high before the general election. However, none of my investments is based on index movement,” he said.